Moody's downgrades Memorial Hospital at Gulfport's bond rating: 3 things to know

Moody's Investors Service has downgraded the rating on approximately $74 million of bonds issued on behalf of Memorial Hospital at Gulfport (Miss.) to "A3."

Here are three things to know about the rating action and the hospital's outlook.

1. The rating downgrade was based on a number of factors, including MHG's significant decline in liquidity as a result of capital investments and increased accounts receivable in conjunction with the implementation of a new EMR system, according to Moody's. Operating performance has also weakened with a -1.5 percent operating margin for the first six months of fiscal year 2015.

2. The hospital's challenges are balanced with MHG's good market position as a large
tertiary provider in its primary service area and conservative debt structure with all fixed rate debt outstanding.

3. The hospital's outlook is negative, which "reflects the continued decline in liquidity as a result of a new EMR system and large capital projects currently in
progress," Moody's said.

 

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